EX-99 2 rc8k061008ex.htm EXHIBIT 99.1

Exhibit 99.1

 

 

 

 

CONTACT:

Investors

PondelWilkinson Inc.

Laurie Berman

310-279-5962

 

lberman@pondel.com  

 

RENTRAK REPORTS FISCAL 2008 FOURTH QUARTER

AND YEAR-END FINANCIAL RESULTS

 

Linear TV Measurement Trials Surpass 2 Million Set Top Boxes

 

PORTLAND, Ore. (June 10, 2008) — Rentrak Corp. (NASDAQ: RENT) today announced financial results for the fiscal fourth quarter and full year ended March 31, 2008.

 

Fiscal 2008 Fourth Quarter Results

Consolidated revenues totaled $22.3 million in the fourth quarter of fiscal 2008, compared with $28.1 million in the year-ago period.

 

•

Revenues in the company’s Advanced Media Information (AMI) segment grew 29.0 percent to $2.8 million from $2.2 million in the fourth quarter of fiscal 2007 and increased five percent from $2.7 million in the third quarter of fiscal 2008. The increases primarily reflect incremental revenues generated from new and existing customers of the company’s Essentials Suite™ of media measurement services. The AMI segment represented approximately 13 percent of consolidated revenues and contributed approximately 28 percent of consolidated gross margin dollars in the fourth quarter of fiscal 2008.

 

•

Revenues in the company’s Pay-Per-Transaction® (PPT) segment totaled $19.5 million, compared with $25.9 million in last year’s comparable quarter and $21.2 million in the third quarter of fiscal 2008. The declines primarily reflect lower volumes of units shipped and fewer rental transactions during the quarter, in part as the result of the previously announced loss of the company’s former fifth and sixth largest product suppliers.

 

Selling and administrative expenses totaled $6.6 million, or 29.8 percent of revenues, in the fourth quarter of fiscal 2008, compared with $6.9 million, or 24.7 percent of revenues, during last year’s fiscal fourth quarter. Operating income was $1.6 million in the fourth quarter of fiscal 2008, versus $2.3 million in the same period last year.

 

Net income was $1.7 million, or $0.15 per diluted share in the fourth quarter of fiscal 2008, compared with $1.6 million, or $0.14 per diluted share, in last year’s comparable period. Fiscal 2008 fourth quarter net income included favorable tax adjustments of approximately $560,000, or $0.05 per diluted share, primarily the result of cumulative tax research and experimentation credits available to Rentrak, related mostly to internally developed software for the company’s Essentials multimedia measurement services.

 

 

Rentrak Reports Fiscal 2008 Fourth Quarter and Year-End Financial Results

Page 2 of 5

 

Fiscal 2008 Full-Year Results

Consolidated revenues totaled $93.2 million in fiscal 2008, compared with $105.7 million last year.

 

•

AMI segment revenues grew 32.7 percent to $10.4 million in fiscal 2008, from $7.8 million in fiscal 2007.

 

•

PPT segment revenues were $82.8 million in fiscal 2008, compared with $97.9 million in fiscal 2007, in part as the result of the previously announced loss of the company’s former fifth and sixth largest product suppliers during fiscal 2007.

 

Selling and administrative expenses totaled $25.7 million, or 27.6% of revenues, compared with $25.2 million, or 23.8% of revenues, in fiscal 2007. The increase in selling and administrative expenses is primarily due to continued, planned investments in the development of Rentrak’s Essentials Suite of media measurement services. Operating income was $5.6 million in fiscal 2008, compared with $8.3 million in fiscal 2007.

 

Net income was $4.6 million, or $0.41 per diluted share, in fiscal 2008, compared with $5.9 million, or $0.53 per diluted share, in fiscal 2007.

 

Rentrak had cash, cash equivalents and marketable securities of $31.8 million at March 31, 2008, compared with $33.5 million at March 31, 2007. The company generated $3.1 million in cash from operating activities in fiscal 2008 versus $5.9 million in fiscal 2007.

 

“Our fiscal 2008 financial results were in line with our expectations,” said Rentrak Chairman and Chief Executive Officer, Paul Rosenbaum. “We generated the cash flows necessary to strategically invest in future growth opportunities, continued operating our businesses in an efficient manner and completed the year in a very strong financial position.”

 

Recent Operating Highlights

 

•

AMI division continued substantial growth trend;

 

•

Inked multi-year video on demand (VOD) measurement agreement with Cox Communications, the third-largest cable television company in the United States;

 

•

Expanded VOD capabilities outside the U.S. with the addition of Rogers Cable in Canada;

 

•

Now providing aggregated, census-level on demand television data for all of the major MSOs in the cable industry;

 

•

Amassed 100 percent on demand measurement market penetration, processing data representing 54 million set-top boxes from 28 MSOs and used by more than 100 content provider partners every day to help them make advertising and programming decisions critical to their businesses;

 

•

On track for commercial launch of linear TV measurement product, TV Essentials™, in the first quarter of calendar 2009;

 

•

Linear TV measurement trials surpass 2 million set top boxes;

 

•

Identifying additional revenue streams through the development of video measurement applications for broadband and mobile; and

 

•

Well positioned to provide independent third party measurement system for dynamic advertising through Ad Essentials product.

 

“We remain confident in Rentrak’s ability to meet the evolving needs of the entertainment industry and are well positioned to drive increasing value to all of our stakeholders through continued innovation, hard work and determination,” concluded Rosenbaum.

 

Rentrak Reports Fiscal 2008 Fourth Quarter and Year-End Financial Results

Page 3 of 5

 

Conference Call

Rentrak has scheduled a conference call for 2 p.m. (PDT) June 10, 2008 to discuss the company’s fourth quarter and full year financial performance. Shareowners, members of the media and other interested parties may participate in the call by dialing 866-271-0675 from the U.S. or Canada, or 617-213-8892 from international locations, passcode 94846109. This call is being webcast and can be accessed at Rentrak’s web site at www.rentrak.com where it will be archived through June 10, 2009. An audio replay of the conference call is available through midnight June 17 by dialing 888-286-8010 from the U.S. or Canada, or 617-801-6888 from international locations, passcode 68731859.

 

About Rentrak Corporation

Rentrak Corporation, based in Portland, Oregon, is an information management company serving clients in the media, entertainment, retail and advertising industries. The company's near-term focus centers on its Entertainment Essentials™ suite of services that is redefining measurement in the digital media era. Available by subscription, each Entertainment Essentials service provides customers with near-real-time, actionable insight into performance of content distributed over a wide variety of modern media technologies allowing executives to analyze detailed industry-wide and title-specific data to make decisions that enhance the bottom line and provide competitive advantage. For further information, please visit Rentrak's corporate Web site at www.rentrak.com.

 

Safe Harbor Statement

When used in this discussion, the words “anticipates,” “expects,'' “intends'' and similar expressions are intended to identify forward-looking statements. Such statements relate to, among other things, the revenues and results of operations for the company’s PPT® and information services segments, the company’s development efforts pertaining to new media measurement services and the timing of the commercial launch of those services; and anticipated customer acceptance of the company’s new media measurement services; and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could affect Rentrak's financial results include customer demand for movies in various media formats subject to company guarantees, the company’s ability to attract new revenue-sharing customers and retain existing customers, the company’s success in maintaining its relationships with studios and other product suppliers, the company’s ability to successfully develop and market new services to create new revenue streams, and Rentrak’s customers continuing to comply with the terms of their agreements. Additional factors that could affect Rentrak's financial results are described in Rentrak's March 31, 2007 annual report on Form 10-K and subsequent quarterly reports filed with the Securities and Exchange Commission. Results of operations in any past period should not be considered indicative of the results to be expected for future periods.

 

# # #

 

(Financial Tables Follow)

 

Rentrak Reports Fiscal 2008 Fourth Quarter and Year-End Financial Results

Page 4 of 5

 

Rentrak Corporation and Subsidiaries

Consolidated Balance Sheets

(In thousands, except per share amounts)

 

 

 

March 31,

 

 

 

2008

 

2007

 

Assets

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

26,862

 

$

11,351

 

Marketable securities

 

 

4,986

 

 

22,105

 

Accounts receivable, net of allowances for
doubtful accounts of $572 and $596

 

 

15,032

 

 

19,577

 

Note receivable

 

 

396

 

 

385

 

Advances to program suppliers, net of program
supplier reserves of $17 and $23

 

 

95

 

 

166

 

Taxes receivable and prepaid taxes

 

 

1,455

 

 

32

 

Deferred income tax assets

 

 

253

 

 

77

 

Other current assets

 

 

1,296

 

 

574

 

Total Current Assets

 

 

50,375

 

 

54,267

 

 

 

 

 

 

 

 

 

Property and Equipment, net of accumulated
depreciation of $7,731 and $6,325

 

 

6,145

 

 

5,097

 

Other Assets

 

 

629

 

 

652

 

Total Assets

 

$

57,149

 

$

60,016

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

Accounts payable

 

$

6,768

 

$

13,707

 

Accrued liabilities

 

 

671

 

 

455

 

Deferred rent, current portion

 

 

90

 

 

90

 

Accrued compensation

 

 

930

 

 

1,631

 

Deferred revenue

 

 

873

 

 

460

 

Total Current Liabilities

 

 

9,332

 

 

16,343

 

 

 

 

 

 

 

 

 

Deferred Rent, long-term portion

 

 

989

 

 

1,050

 

Deferred Income Tax Liabilities

 

 

226

 

 

333

 

Taxes payable, long term

 

 

1,965

 

 

—

 

Notes Payable

 

 

965

 

 

955

 

Total Liabilities

 

 

13,477

 

 

18,681

 

 

 

 

 

 

 

 

 

Commitments and Contingencies

 

 

—

 

 

—

 

 

 

 

 

 

 

 

 

Stockholders’ Equity:

 

 

 

 

 

 

 

Preferred stock, $0.001 par value; 10,000
shares authorized; none issued

 

 

—

 

 

—

 

Common stock, $0.001 par value; 30,000
shares authorized; shares issued and outstanding:
10,605 and 10,724

 

 

11

 

 

11

 

Capital in excess of par value

 

 

47,189

 

 

48,155

 

Accumulated other comprehensive income

 

 

170

 

 

132

 

Accumulated deficit

 

 

(3,698

)

 

(6,963

)

Total Stockholders’ Equity

 

 

43,672

 

 

41,335

 

Total Liabilities and Stockholders’ Equity

 

$

57,149

 

$

60,016

 

 

 

Rentrak Reports Fiscal 2008 Fourth Quarter and Year-End Financial Results

Page 5 of 5

 

Rentrak Corporation and Subsidiaries

Condensed Consolidated Income Statements

(Unaudited)

(In thousands, except per share amounts)

 

 

 

For the Three Months Ended March 31,

 

 

 

For the Twelve Months Ended March 31,

 

 

 

2008

 

2007

 

 

 

2008

 

2007

 

Revenue

 

$

22,298

 

$

28,112

 

 

 

$

93,188

 

$

105,721

 

Cost of Sales

 

 

13,987

 

 

18,883

 

 

 

 

61,814

 

 

72,242

 

Gross Margin

 

 

8,311

 

 

9,229

 

 

 

 

31,374

 

 

33,479

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling and administrative

 

 

6,647

 

 

6,949

 

 

 

 

25,683

 

 

25,188

 

Asset impairment

 

 

85

 

 

—

 

 

 

 

85

 

 

—

 

 

 

 

6,732

 

 

6,949

 

 

 

 

25,768

 

 

25,188

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

1,579

 

 

2,280

 

 

 

 

5,606

 

 

8,291

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

301

 

 

406

 

 

 

 

1,517

 

 

1,521

 

Interest expense

 

 

(3

)

 

(2

)

 

 

 

(10

)

 

(7

)

Other income

 

 

144

 

 

—

 

 

 

 

144

 

 

—

 

 

 

 

442

 

 

404

 

 

 

 

1,651

 

 

1,514

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

2,021

 

 

2,684

 

 

 

 

7,257

 

 

9,805

 

Provision for income taxes

 

 

332

 

 

1,109

 

 

 

 

2,663

 

 

3,918

 

Net income

 

$

1,689

 

$

1,575

 

 

 

$

4,594

 

$

5,887

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income per share

 

$

0.16

 

$

0.15

 

 

 

$

0.43

 

$

0.55

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per share

 

$

0.15

 

$

0.14

 

 

 

$

0.41

 

$

0.53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in per share calculations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

10,684

 

 

10,662

 

 

 

 

10,728

 

 

10,632

 

Diluted

 

 

11,110

 

 

11,243

 

 

 

 

11,227

 

 

11,170